Five Questions to Ask Before Launching an Online Business

I know that many entrepreneurs believe that the key to growing their businesses or launching a business is an online component. This is not necessarily the case and entrepreneurs should ask and answer five key questions before launching an online business and engaging in e-commerce.

Will your customer patronize you online? It is important to determine if your target market is tech savvy and willing to buy from you online. If you serve customers that prefer face to face contact then an online strategy may not be wise. The type of product or service you offer will also be critical in determining if you should engage in business online. If you’re a tailor or seamstress for instance – this is not a product or service that aligns well with an online approach. If you are convinced that an online presence in your market is the future you may wish to consider a hybrid strategy. Some online business and some offline offerings.

Do you have technical expertise? This is an important question. Now you do not need technical expertise but the less you know the more you will have to rely on others’ services to build and maintain your online presence – and the more costly it will be. I use WordPress for my online presence but I created and maintain my sites on my own which reduce my recurring expenditure.

How will you distribute your goods/services? If your goods and services are digital this makes it much easier, but there are still questions to consider – will it be through downloads hosted on your site or through third-party sites? Non-digital products also require a distribution strategy. The bottom line is although you may be selling online how are your customers going to access your goods and services?

How will you receive payment? Online business requires the use of online payment gateways – PayPal being the most popular. There are quite a number of payment gateways available to facilitate payments but it is important to review the fees associated with your options and which countries you can accept payments from.

How will you provide customer service? Customer service is as important online (if not more so) as it is offline. Customers should not feel isolated. Will you need an additional employee to provide customer service or outsource the function as you grow? Will you provide service by email , by telephone, online chat or all of the above?

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